Eight days after Dell and EMC announced their merger plans, EMC and VMware announced plans for a cloud computing services joint venture that would be called Virtustream. However, VMware (which is majority-owned by EMC but has its own board) has now announced that it is pulling out of the Virtustream deal.
VMware shares had dropped after the Virtustream announcement, which was unpopular with shareholders. The virtualization company’s shares initially climbed after the news broke that it was abandoning the Virtustream plan but later resumed their decline.
The development will likely have an impact on the planned Dell-EMC merger, as VMware tracking shares are being used to help finance the deal.